USA Technologies, Inc. (USAT) marked 48 percent growth in its ePort Connect® customer base, to over 6,075 customers as of Dec. 31, 2013 compared to one year prior, by highlighting customers, J&J Vending and Tomdra Vending and Coffee Service (Tomdra), for its recognition of cashless as a strategic platform for improving financial performance and customer satisfaction, according to the release.
"J&J Vending and Tomdra are great examples of how USAT is bringing valuable data and deployment strategies to its customers through a comprehensive cashless payment program that helps them transition to cashless payment effectively," said Stephen P. Herbert, USAT's chairman and chief executive officer, in a prepared statement. "In a cashless environment, consumers come to these machines every day and provide us with valuable information about their buying and purchasing preferences — advantageous information that we believe can be used to drive improved customer satisfaction and new sales. One of our goals is to ensure our customers participate in that knowledge and enjoy the multiple benefits that a cashless payment platform can provide their business."
J&J Vending, a full-line vending and office coffee operator serving the San Francisco Bay area, has indicated that they are moving forward to install cashless on one-third of their approximately 1,200 machine base.
"USAT has been educating us on the benefits for quite a while now, but the data from our initial cashless installation really enlightened us," said Joel Skidmore, president and CEO of J&J Vending. "Both cash and cashless sales increased and profitability of our machines increased. I had to ask myself why I hadn't been doing this before.
"From a customer perspective, they love it," continued Skidmore. "We realized that by not having credit card options, we were losing a whole set of customers. I was recently visiting a coffee customer and noticed an employee going from person to person in the break room asking for change—I realized I had just lost a sale. Now we are sold on cashless, and I love the fact that we can enhance our bottom-line even further by utilizing other service options USAT offers. Going cashless is definitely a priority for us now."
Tomdra, an award-winning, full-service vending company and USConnect member located in Tucson, Ariz., believes cashless is the future—whether consumers are using a magnetic card, mobile phone or another contactless option.
"The business case for cashless is really about convenience—that's what drives sales," said Todd Elliott, vice president of Tomdra. "Similar to a purchase at a convenience store, consumers are not as sensitive to price when there's no restriction on the purchase. We see proof of that in our data, accessed through ePort Connect's web portal, whereby our average cashless transaction is 40 percent higher than a cash transaction, and almost every other person buys multiple products. That incremental revenue adds up. In addition to the revenue benefits, with costs going up, you have to be in a position to adjust prices. Without a cashless platform, that's much more difficult.
"We have been a longstanding customer of USAT—ePort Connect is an essential tool for us and we leverage many of their expanded services. From a planning perspective, what we've noticed in the last few years is that cashless usage and sales levels are increasing as consumers become more accustomed to cashless options on vending machines. Overall, our average ratio of cashless usage is over 40 percent—that's more than double what it was four years ago.
"In addition, the data indicates that it's not just about the younger generation—cashless usage is prevalent across all age groups and businesses we serve," continued Elliott. "That tells me that, as an industry, it's more important than ever that vending keep pace with other retail channels to stay relevant to consumers. For Tomdra, that dictates a move from approximately 50 percent cashless deployment today to around 80 percent deployment overall. For the industry at large, I'd say it means that if you're not taking steps to offer cashless (and there is a cost to it), you are probably on your way out of any meaningful vending business over the next five years."
"We believe the remarkable growth in our customer base is indicative of a growing awareness of cashless payment in self-serve retail," said Herbert. "In addition, we estimate our ePort Connect customer base manages a population of over 2 million self-serve retail locations that have yet to transition to cashless payment, providing USAT with considerable opportunity to drive more connections to our service."
As of Dec. 31, 2013, connections to USAT's comprehensive cashless payment and telemetry service, ePort Connect, had grown by 20 percent from the same period in the prior year, to 224,000 connections.
